This is How YouTubers Make Money

Oct 16, 2014


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One of the most frequent questions people ask me when they find out what I write about is, "How do YouTubers make money?"

Oh, boy.

This used to be a simple answer. When the very first YouTubers started making money, it was predominantly through electing to run ads on their channels' videos (which you can still do today), but also through selling merchandise. Creators would link to their branded t-shirts, stickers, buttons... basically, whatever they could cheaply produce and still earn a small profit from. More progressive production companies, who were already successful enough they could afford to take a few risks, would encourage viewers to sign up for their membership sites, promising exclusive content and promotions galore.

While these are still tried and true methods, some YouTubers have decided to experiment with other methods of monetization over the years. And why not? The ever-increasing popularity of online video is enough incentive for creators to maximize their earning potential.

For starters, distribution has changed in some very unique ways. While many creators are still selling items directly from their stores, they're looking for other ways to get their more expensive and time-intensive products in front of as many eyes as possible. For example, creators are partnering with larger companies who specialize in distribution to put their content out there - this is what comedy trio Hannah Hart, Grace Helbig, and Mamrie Hart did for their film Camp Takota. And in a bolder move, YouTuber Kurt Hugo Schneider debuted his film College Musical during a livestream and then put it on iTunes for purchase. Hundreds of Schneider's fans caught the livestream viewing (they got the hashtag #CollegeMusical to trend on Twitter), and are now able to help spread the word about the movie through word-of-mouth.

Other YouTubers are hearkening back to the days of old when artists were supported by patrons. They figure if their audiences truly love what they're doing, they'll be supportive monetarily. And many times, audiences are. Kickstarter and Indiegogo are the go-to destinations for requesting fan funding for projects that YouTubers might otherwise have a hard time producing themselves. Additionally, YouTubers can now use several sites, one of them being the aptly-named Patreon, as digital "tip jars" where fans can go to donate money whenever they feel like it - not for a specific project by a creator, but just as a gesture to say "I love what you're doing; keep it up." YouTube itself is testing its own tip jar feature with a few beta creators; if it works well, all creators will be able to use the feature.

On top of that, YouTube also just announced they're going to pay some of their top creators. Of course, this won't apply to all users on the site; the select few with a proven track record of gaining followers and making an impact will get first dibs. Whether or not this is an incentive to stay on YouTube's video platform instead of heading over to the burgeoning Facebook video efforts is speculation at this point. However, it's very telling when one of the largest online video sites decides to straight-up pay its top users in something other than ad revenue (which is still a laudable effort, because for years this revenue form has made YouTube the only social media site to pays its users - you don't get paid to tweet, do you?).

Like many celebrities, YouTubers also have methods of making money that are more "traditional." Appearances and speaking engagements are a very easy way to make money once your name is big enough to reach beyond the scope of just your YouTube fans. While in theory any YouTuber could implement this tactic into their business, it works really well with those who are a) popular, b) educational, or c) both of the former. A good example is Laci Green, who runs a channel called Sex+ all about sex education. She's available for speaking engagements at schools and other young adult gatherings. In a world where teenagers would probably rather hear about this topic from a person close to their own ages, it's a smart financial decision for Green.

The people who are curious about YouTube seem to assume such endeavors aren't financially plausible. They don't see the video creators as "real" people who need to earn a living. It's not that they can't see them this way, they just never gave it a thought. Which is why I'm always glad when they ask me that age-old question, "How do YouTubers make money?"


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